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Employment figures ‘the worst for 2 years’

Economists also suggested the weak jobs data could be a sign that productivity is improvingPA

George Osborne has suffered a setback just a week after his Budget with the worst set of official jobs figures in two years.

Taking markets and forecasters by surprise, unemployment rose to 5.6 per cent in the three months to May and employment fell by 67,000. It was the first fall in employment since April 2013 and first rise in the unemployment rate since November of the same year, according to the Office for National Statistics.

There was little cause for cheer in the wage data either. Average earnings rose by 3.2 per cent, the best three-monthly performance since April 2010, but fell short of expectations of 3.3 per cent.

The increase was driven by bonuses while the growth in regular pay only crept up…